Digital cable television appliances are becoming mainstream devices in the modem home. These devices may be stand-alone “set top boxes” that are either leased from the cable operator or purchased by the consumer through retail channels. The device may also be integrated directly into new television receivers as part of the “plug and play” initiative for digital television, for example as mandated by the U.S. FCC (Federal Communications Commission).
As the cost of implementing digital decoding capabilities in consumer products rapidly declines and the prevalence of digital programming on cable television systems grows, the cable industry is executing plans for removal of all remaining analog television services from their systems to reclaim spectrum, reduce operational costs and reduce signal theft. The result, for the foreseeable future, will be that cable operators must supply their customers having legacy analog televisions, VCRs, etc. with digital converters that convert the digital signals to analog signals used by these legacy devices in order for these devices to continue operation in an all-digital network.
Industry estimates at this writing indicate that there may be four or more legacy analog devices attached to the cable system in a typical household in addition to any existing digital cable converter or CableCARD™ enabled products. Because of the sheer volume of digital converters that the cable operators will need to deploy to support all of the analog devices presently in their subscribers' homes, and the fact that these devices cannot presently utilize electronic program guides, video-on-demand or pay-per-view services, cable operators have no method to recover the huge capital outlay on the advanced, two-way digital cable boxes they currently have available to deploy. As a result, their attention is now focusing upon very inexpensive, one-way digital converters for this purpose, providing current analog subscribers like-for-like digital service at a significantly lower cost to the operator than replacing analog devices with presently available two-way devices. Many cable operators, for regulatory and other reasons, intend to provide these one-way converters at no cost to their subscribers and believe that the cost of providing these devices can be more than offset through the recovery of valuable spectrum, reduction of operational costs—i.e. “truck rolls” (service calls) for. connect/disconnect and elimination of signal theft.
These simple digital converters are generally intended only for the most basic service tiers, ones that are presently delivered in analog form and therefore left unprotected against unauthorized reception, unlike the current premium services, which employ modern digital encryption. A conservative estimate is that as many as one third of the channels carried in modern cable systems are presently still analog basic services and national research indicates that roughly 11.5 million U.S. households steal these cable services each year at a cost of $6.5 billion in lost revenue annually (see Cox Communications Press Release Cox Communications Joins Nationwide Signal Theft Awareness Week June 1-5, BUSINESS WIRE, May 21, 2004).
The transition of the basic tiers from analog services to exclusively digital services having encryption applied will eliminate most of the present forms of signal theft that occur because these new digital converters will be individually addressable by the cable operator. Unlike today, merely having physical access to the cable signal either through unauthorized connection by tampering or because there hasn't been a costly dispatch of field personnel to the premises to implement a disconnect will no longer suffice for present analog customers to receive services for which the cable operator is not compensated. This also applies to new digital television receivers if the owner has not obtained a CableCARD™ from the cable operator and had it electronically authorized for service.
A typical conversion scenario for the all-digital transition would be for a cable operator to upgrade a headend serving a community or city to carry basic tier content in digital form in addition to the analog format presently carried. Next, all current two-way devices deployed for decoding premium digital services are reprogrammed to receive only digital content, including the new digital replacements for the analog tier, instead of the present mixed formats. In parallel, the operator will begin distribution of the new one-way converters to existing subscribers based upon the number of cable outlets in the home that are reported by the subscriber as connected to a legacy analog device (Video Cassette Recorder, television, etc.). There is no way for the cable operator to determine externally the analog device count without either surveying the subscribers or performing a physical audit. The operator will likely deploy these new converter devices en-masse to subscribers as each node of served by a cable headend is converted from mixed analog/digital to all digital through the removal of analog services. A node typically serves from 500 to 2000 customers and the converters must be available to subscribers prior to cutover to avoid service interruption.
While the introduction of all-digital services and low cost digital converters would seem to address all the issues of unauthorized viewing and signal theft, because the low cost converters are only one-way devices, a new opportunity to deprive cable operators of fair payment for service emerges. When subscribers are contacted to determine the quantity of converters necessary for supporting the analog appliances in the home, the subscriber may intentionally “over-report” the quantity of analog appliances in the home. They can later provide the converters received from the cable operator to friends, family, etc. to “split the costs” of basic cable service. There are other models where one-way converters can be redistributed without the knowledge or authorization of the cable operator. Since these devices are assigned by the operator to a valid subscriber, they remain authorized and the cable operator is deprived of subscription revenue because the devices are present in locations other than the home of record for the authorized subscriber.
Other one-way devices that attach to the cable network also suffer from the same issue. The new CableCARD™ device for digital televisions is an example of such a device that suffers the same vulnerability to unauthorized redirection. Two-way devices, such as existing digital cable decoders for premium services, are less likely to suffer from this issue because there are ways to detect electronically the location of these devices through headend interrogation and response with the time delay to respond being measured to determine the cable distance to the device. In such an application, the response time values for two devices assigned to the same address can be compared for similarity and physical proximity inferred.